India to Launch Critical Mineral Stockpile Plan

• India sets up stockpile to secure rare earth elements for green tech
• Rs 7,300 crore scheme aims to produce 6,000 tonnes of rare earth magnets
• India holds 7.23 million tonnes of rare earth oxide, with auctions and Rs 500 crore allocated to ensure supply

The Indian government is about to initiate the National Critical Mineral Stockpile (NCMS), a specific program to ensure the future availability of rare earth elements (REEs) in the country, officials said.

The measure is a response to China's restrictions on the exports of rare earth magnets, which are used in electric vehicles, wind turbines, and other green technologies, to the disruption of global supply chains.

India is establishing a national stockpile of critical minerals and rare earth elements to enhance supply chain security and safeguard its mineral resources.

A senior government official  stated, "We are looking to create a two-month stockpile of rare earth elements under the programme, with a focus on private player participation. The initial focus is on rare earth elements. The scope will later expand to include other critical minerals".

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Rare earth elements, consisting of 17 chemically similar elements, are prized for their magnetic and electrical properties, in particular for high-tech uses like rare earth magnets. The NCMS, will be a supplement to the government initiative to boost production of rare earth magnets domestically. Reports suggest that there had already been an inter-ministerial panel approval of a Rs 7,300 crore incentive program to manufacture 6,000 tonnes of rare earth magnets in the next five years.

The government has done Rs 500 crore as part of the National Critical Minerals Mission to mitigate risks associated with supply disruptions and provide critical minerals for domestic consumption. Analysts note that while China’s supplies have shown signs of easing, its export curbs are still stringent, and rising geopolitical tensions, such as the potential for US tariffs on Chinese imports, only amplify the need for a reliable domestic source.

However, there is a key limitation identified by analysts: the technology available in India to extract rare earths from domestic resources is limited, and most is imported currently. India is estimated to possess about 7.23 million tonnes of rare earth oxide in approximately 13.15 million tonnes of monazite, spread over AP, Odisha, Tamil Nadu, Kerala, West Bengal, Jharkhand, Gujarat, and Maharashtra.

The Ministry of Mines has conducted five rounds of auctions for 55 blocks of strategic critical minerals and successfully awarded 34 blocks in total. The sixth round auction for more blocks was recently announced. The NCMS along with incentives for domestic production is expected to bolster India's ecosystem on rare earths further, reduce India's dependence on imports, and contribute towards India's transition to clean and green technologies.